The construction data provider has highlighted faltering confidence as the main driver for this fall in activity. In particular, ongoing uncertainty around public spending intentions have led contractors and developers alike erring on the side of caution.

Residential construction was hit particularly hard in February, with the value of project starts down 10% on the preceding three months and 14% lower than 2024 figures.

“The drop-off may reflect a scaling back of expectations regarding the timing and strength of the economic upturn, consumer spending, and the housing market this year,” said Allan Wilen, economic director at Glenigan.

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“While housing market activity and prices have picked up in recent months, momentum is likely to slow once the new Stamp Duty regime kicks in from April. Financing issues, especially unfavourable credit conditions, also appear to be a factor, especially for smaller housebuilders.”

Non-residential starts also saw declines with a 2% decrease against the preceding three months and an 18% year-on-year decline, with Glenigan attributing this to the government “keeping funding cards close to its chest”.

Despite this, outlier data was recorded in some regions.

Northern Ireland was the standout performer with a 44% rise in construction activity in February compared to the preceding three months, and 76% higher than 2024.

Data was also healthy in the South West where construction starts increased 11% from the preceding three months, and 18% from 2024.

However, London and the South East recorded the heaviest falls. Construction starts were down in these areas by 40% and 14% from 2024, respectively.

Allan added: “This latest downturn appears to reflect faltering consumer and business confidence combined with the disruption of public sector capital programmes. Whilst the Chancellor increased capital funding for key departments for 2025/26, the current decline in project starts underlines the need for a rapid deployment of the promised funds from April.”